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Hutchison Port volumes impacted by global trade decline on Covid-19

Photo: Joseph Chan - Unsplash joseph-chan.jpg
Hutchison Port Holdings Trust (HPHT) has seen its overall container throughput decline and profit fall in the first half due to the severe slowdown in global trade amid the coronavirus (Covid-19) pandemic.

From January to June 2020, throughout of HPH Trust ports overall was recorded at 10.28m teu, down 8% year-on-year.

Breaking down, throughput for YICT and HICT was at 5.46m teu, down 12%. The combined throughput of HIT, Cosco-HIT and ACT, or collectively HPHT Kwai Tsing, was at 4.82m teu, down 3%.

“The global trade was negatively impacted by the Covid-19.  In the first half of 2020, outbound cargoes to the US and Europe declined by 17% and 10% respectively.  Throughput drop for YICT in the first six months of 2020 was mainly attributed to the decrease in the US, Europe and empty cargoes,” HPHT stated.

“The decline in throughput for HPHT Kwai Tsing was mainly due to reduction in intra-Asia, the US and transhipment cargoes,” it said.

First half profit attributable to shareholders was recorded at HKD212.4m ($27.4m) , down 9% year-on-year.

HPHT recalled that manufacturing in China was at a standstill as factories completely suspended production after Chinese New Year in January. Global supply chains and business activities have been disrupted, resulting in a slump in global cargo volume.

“HPHT, with HPHT Kwai Tsing being a major transhipment hub in the region, and YICT being the premier gateway to China for foreign trade, was inevitably affected,” HPHT said.

However, recent developments on the Covid-19 situation has seen gradual improvements in the region, as manufacturing in China has mostly resumed and many overseas countries have loosened lockdown and border controls.

“It is expected that the negative impact of Covid-19 on our volume will gradually be reduced,” HPHT said.

To mitigate the sharp downturn in demand caused by Covid-19, shipping lines have cut their capacity to maintain rates through an increase in blank sailings and service suspensions.

“During this difficult business environment, HPHT has been exploring different initiatives to improve performance. HPHT remains vigilant about the situation and will continue to focus on operational efficiency and cost management, as evidenced by the formation of Hong Kong Seaport Alliance, to increase the competitiveness of our ports,” HPHT stated.